Soon after its top investor turned down a break-up plan, HSBC raised questions on Tuesday from disgruntled retail investors and its executives defended its strategy to operate as a global bank in its first meeting in Hong Kong in three years .
The London-headquartered lender is under pressure from China’s Ping An Insurance Group Co to explore options, including closing its core Asia business, to boost shareholder returns.
HSBC Chairman Mark Tucker and CEO Noel Quinn were grilled by investors for more than an hour on the bank’s strategy for dividends and growth at a meeting that was attended by hundreds of shareholders in the business district.
“It is ‘too late’ to resume quarterly dividend payments in 2023 and the promised level of dividends is ‘too low’, said Jay Chong, an active shareholder who is in his 30s and whose family’s He holds more than half a million shares of HSBC.
Hong Kong is the largest market for HSBC Holdings and a major investor base for the Asia-focused bank. Some investors in the city have been vocal in support of Ping An’s plan.
About 30 retail investors of HSBC held a brief protest near the entrance of the conference room just before the start of Tuesday’s meeting, raising slogans of ‘management must step down’ over dividend cancellations and sluggish returns.
HSBC met with retail shareholders a day after rejecting a break-up call as it reported forecast-beating profits, raised a profitability target and promised chunkier dividends. The bank has argued that a spin-off would be costly, time-consuming and require billions in technology spending, while also increasing regulatory risk.
“Our strategy, which is now two and a half years into implementation, should put the bank on track to deliver returns in 2023, which we haven’t achieved in the last 10 years,” Tucker said on Tuesday. “This return will help propel and propel the share price and will have a positive impact on the dividend.”
Analysts said Hong Kong retail shareholders are unlikely to be forced to vote on the break-up. Large institutional investors have yet to comment.
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